Mah Sing is bullish on the local property market

Mah Sing Group Bhd is bullish on the local property market, especially for the second half of this year as various market indicators appear to have bottomed out.

The indicators include residential property transactions that had declined at the lowest pace in the fourth quarter of 2015 from the third and second quarters, as well as further contraction in house prices.

“The house price index showed that it has moderated to a more sustainable level, from 11.8% to a single-digit growth of 5.8% now, ever since the cooling measures were introduced in 2012.

“We believe that this is a healthy level and there is no need for more cooling measures,” said Mah Sing executive director Datuk Steven Ng.

He was speaking to reporters on the sidelines of Invest Malaysia 2016 yesterday.

Ng added that house prices were unlikely to contract further and would grow within single digit range.

On the demand for housing, Mah Sing group managing director and chief executive Tan Sri Leong Hoy Kum said the demand for affordable residential segment was doing well and has outstripped supply in the market.

As such, he said that for the next two years, Mah Sing would be focusing on the affordable housing segment to play catch-up with the market.

“In 2016, 89% of its residential launches will be priced below one million, of which 50% will be priced below RM500,000,” he said.

Mah Sing, which is sitting on RM4.75bil of unbilled sales, is targeting sales of RM2.3bil in 2016 after posting RM3bil sales last year.

“We will maintain our sales target until we see signs of improvement.

“But we expect to see a better improvement in the market in the second half of 2016 compared to the first half,” Ng said.

“While we were all prepared for the GST (goods and services tax) implementation, we did not realise the extent of the impact of the slump in oil price and the ringgit on consumer sentiment,” he added.

He noted that the company had also scaled down its launches for this year to RM2bil projects from RM3.4bil targeted previously.

He said that the sales growth for Mah Sing this year would be supported by the company’s ongoing projects.

Mah Sing has remaining land bank that could be translated to RM28.1bil gross development value (GDV) which can last the company for the next eight to nine years. - The Star

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